This article is reprinted with authorization from "Hua Li Hua Wai," and the copyright belongs to the original author.
A few days ago, a friend left a message in the background asking: Should I buy US stocks now? Or is it better to buy cryptocurrencies? Which one is easier to make money from?
This is a good question, but it seems to be one that doesn't have a standard answer. Personally, my attention has been focused on the crypto market in recent years, but I wouldn't strongly recommend others to dive in just because that's where my focus lies.
Whether it's US stocks, cryptocurrencies, or other markets or asset classes (such as gold), the choice of which to participate in should be based on each person's actual situation, considering factors like risk preference, capital size, time and energy, and even personal interests.
Of course, if your capital allocation is sufficient and your time and energy allow, you don't need to be overly concerned about which one to participate in; you can try participating in both. For example, in the choice between US stocks and cryptocurrencies, if your risk preference is relatively low, you might lean towards allocating more to US stocks while also holding some higher-risk cryptocurrency positions, and vice versa.
Additionally, making money is often relative rather than absolute. Don't casually assume that just because you see others easily making hundreds of thousands or millions through US stocks or cryptocurrencies, that it's easy to make money. You can't see the reasons behind why others are making money (what they know that others don't, what they do that others can't). From my personal observation, the reality is that if someone enters a market with the mindset of guaranteed profits, they are likely to end up losing money.
For some time now, I've noticed that many people hold the view that the correlation between stocks (US stocks) and the crypto market is increasing, meaning that the rise in stocks will drive the rise in the crypto market, as liquidity (capital) often moves down the risk curve.
Theoretically, this seems to make sense because, generally speaking, liquidity does tend to flow first into relatively lower-risk and more certain assets before gradually moving into higher-risk assets. For example, in terms of the risk curve, the general flow of capital is roughly: US Treasuries/gold → stocks → Bitcoin/Ethereum… (this is just a simple conventional example).
Let's look at a few representative assets:
NVDA (NVIDIA) has increased by about 1600% over the past three years, and PLTR (Palantir) has increased by about 2300% over the same period.
BTC (Bitcoin) has increased by about 660% over the past three years, and ETH (Ethereum) has increased by about 400%.
In the recent past, US stocks have remained the main asset class leading the trend in risk pricing. From the perspective of capital preference, if stocks can provide better liquidity and returns, then crypto assets should be less attractive.
But why has the positive correlation between stocks and the crypto market become a common view among many people?
I believe there are a few underlying reasons for this:
First, as global inflation issues intensify, the attractiveness of fiat currencies and fixed-income assets will certainly decrease, and those asset classes that can hedge against inflation will naturally become the choice for more capital, such as stocks of tech companies that represent future productivity (AI) or even cryptocurrencies like BTC.
Second, with the urgent need for global productivity reform, artificial intelligence and blockchain technology seem to be highly anticipated by the market, and this expectation for the future will be reflected in the prices of certain assets, driving up the valuations of corresponding asset types. In other words, the essence of investing is a bet on future trends, and AI and blockchain technology seem to be regarded by the market as the core narrative for the next decade.
To further explain, as capital is influenced by macroeconomic factors, global liquidity is overflowing, and some tech stocks (like AI) and cryptocurrencies (like BTC) that align with future discovery trends are viewed as high-growth risk asset classes, leading to synchronized capital movements.
Additionally, the current bull market has seen more institutional investors entering the crypto market (including ETFs, RWA, etc.), combined with increasingly clear policies and regulations regarding the crypto market, which has also intensified the correlation between cryptocurrencies and stocks.
In the long term, if your goal is the next decade, continuing to invest in high-quality companies and asset classes that align with future development trends can still yield better returns. However, in the medium to short term, large market cycles are composed of various smaller cycles, and we will still face various market volatility risks. I do not believe that stocks or cryptocurrencies will continue to rise indefinitely.
Returning to the crypto market, since 2023, we have been experiencing a bull market, but even in a bull market, there are significant fluctuations on a weekly basis. For instance, there may be several weeks of rapid increases followed by several weeks of sharp declines, but more often, the market is actually consolidating sideways. This is also why I rarely engage in frequent trading now, as I know that compared to participating in trades frequently, knowing when to actively participate and when to remain calm (not participate) is one of the keys to maintaining strength (stability) and an advantage in this market over the long term.
Currently, gold is performing well, and US stocks are also doing well. If Bitcoin can maintain above $120,000, then the crypto market in the fourth quarter is still worth looking forward to. However, we will continue to hold the overall view from previous articles: the fourth quarter is a period of both opportunities and risks. We may see a phase of bullish tail in the crypto market, and unless a new black swan event occurs, based on existing cyclical patterns and the current macro liquidity changes and market structure developments, we may start to enter a new phase of bear market in the first half of next year (2026). In the second half of 2026, we can look for new entry opportunities and may see Bitcoin above $200,000 by 2028.
From historical experience or patterns, the last 2-3 months of each bull market are often the periods when altcoins see the largest increases. So, how can we better seize this final phase of opportunity?
- Don't get deeper into garbage projects
If you already hold one or several altcoins, and as the market changes, other fundamentally sound altcoins start to rebound strongly, but the coins you hold have not changed much in price or continue to decline, many people's choice will be to hold on out of reluctance, or even buy more as the price drops, hoping to sell after breaking even.
Our suggestion is that if you have better projects in mind (after thorough research), a good choice at this time is to promptly stop-loss on your current positions and reallocate the funds to other projects you are more optimistic about.
Of course, unless you have a long-term positive outlook on the projects (tokens) you hold and have sufficient reasons and long-term confidence in them, you can continue to hold and wait, or even buy more as the price drops. Otherwise, continuing to hold onto projects you no longer have confidence in will only increase your losses and may even lead to the risk of total loss or a breakdown in mentality.
If you currently do not have any projects you are optimistic about, the simplest approach is to directly monitor the price fluctuations of major assets like BTC and ETH while keeping a sufficient proportion of cash (USDT) to wait for a new round of larger opportunities.
- Find experiences and lessons in failed trades
Over the past few years, I have seen many messages in the background and encountered various people and issues. For example, there was a friend who, after believing a certain KOL's words, blindly invested over 600,000 RMB in an altcoin he didn't understand (without doing any research), and soon lost about 70% of his principal. He then repeatedly messaged me asking when that token would rise and if he still had hope of breaking even…
Not long after, he messaged again saying he had sold that token and used the remaining 60,000 RMB to buy another hundredfold coin recommended by another KOL, only to lose 50% again in less than a week. He continued to message me daily asking what to do and even said he hoped I could save him, offering to give me his exchange account to help him trade, promising a 100,000 RMB reward if I could help him recover his 600,000 RMB principal, after which he would quit and never trade again.
As for what happened to this friend later, I don't know, because I couldn't really manage his exchange account for him, and I eventually found his messages too frequent (a bit harassing), so I chose to block him. To be honest, at first, I would reply seriously and comfort him while pointing out his issues, but later I realized that no matter what you said, he seemed to not listen at all, repeatedly asking the same questions.
To say something that might not be well-received, if someone casually gave me 30,000 RMB, I could easily help them make 600,000 RMB. Wouldn't it be better for me to just make money for myself? Why should I make money for others for that so-called reward!
From an investment/trading perspective, the only way to do well in this is to find experiences and lessons in both successes and failures, especially the lessons from failures, which are the most valuable. However, many people seem to not realize this; they often continue to trade with the same failures after experiencing a trading loss as if nothing happened.
To put it bluntly, this bull market has been going on for almost three years now. If you haven't made money in the past three years or still feel disappointed with this bull market, then the problem may not lie with the market but rather with your execution strategy, which may still need review or optimization (though this may sound harsh).
In short, we shouldn't blame the market when we lose money. The market itself doesn't have a right or wrong. If you lose money, calmly admit it's your fault, and we should reflect more on the question: where did my trading go wrong? How can I prevent or avoid the same issues in the future?
- Sell in an uptrend rather than buy
For experts, such as some technical traders, they can certainly buy a lot (or go long) in an uptrend to make money. However, for many ordinary investors, a better strategy is still to persist in buying spot early on and gradually (in batches) sell during the uptrend.
For example, the dollar-cost averaging strategy we have been implementing involves consistently building positions in batches during a bear market (triggered by certain buying indicators) and then gradually reducing positions during a bull market (triggered by certain selling indicators or achieving predetermined profit targets) according to plan.
However, the simpler the strategy, the more difficult the actual execution seems to be. It's like how most people believe that long-term dollar-cost averaging in Bitcoin will definitely yield profits, but the number of people who can stick with it appears to be quite small, as they continuously face various market temptations or inducements.
Most people seem to act contrary to their intentions out of fear of missing out. For instance, if someone notices that a token in their watchlist has suddenly surged several times, they can't help but chase the price, resulting in losses of principal or profits.
Price increases often create better exit liquidity rather than enabling all ordinary people to achieve shared prosperity. When we attempt to invest in a token that has already seen significant gains, the first consideration should be the risk involved, not the potential for greater returns, as the high-risk volatility at this point may exceed expectations.
Of course, from a psychological trading perspective, if you are very optimistic about a particular project (token) but have not bought in for some reason, and now see it has increased several times, feeling regret, it might be wise to wait for a pullback or significant drop before buying and holding. This market has never been short of opportunities.
That's all for today. The above content is just personal viewpoints and analyses, intended for learning records and communication purposes, and does not constitute any investment advice.
Related: Polls show: Cryptocurrency-oriented candidates may influence U.S. midterm election voters
Original article: “Will U.S. Stocks and Cryptocurrencies Continue to Rise? How to Seize Stage Opportunities in a Bull Market?”
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
